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Make Hay While The Sun Shines

A realistic exchange rate, better growing conditions, and solid commodity prices have given this government a windfall gain. While economic conditions are buoyant, we must address some of the problems in our economy, Federated Farmers of New Zealand President Alistair Polson told the Federation's National Conference in Rotorua yesterday.

"Total agricultural GDP rose 20% last year, twice as fast as the rest of the economy," Mr Polson said. "That is a staggering $2.6 billion increase in one year and prospects remain bright."

Mr Polson said farmers must question the nature of Government's involvement in the economy. "While other OECD countries strive to reduce Government spending as a percentage of GDP, we put taxpayer's money at risk in the 'Peoples Bank' and flirt with subsidising unprofitable rail lines."

"Lack of investment remains a problem for New Zealand. To encourage investment we must have an internationally attractive and competitive economy. However, the Government has lifted tax rates and done little to stop the regulatory 'creep'."

Mr Polson suggested that a Regulatory Responsibility Act is required to cut off new and unnecessary legislation before they become law.

"If New Zealand is to remain globally competitive we cannot ignore constraints like the RMA, creeping regulation and high tax rates. The Federation is working tirelessly on these issues because we know how important they are to our members who compete on a daily basis with other producers around the world."

"The Resource Management Act (RMA) allows the urban-based community living in their highly modified environments to dictate and place often unreasonable demands on farmers," Mr Polson said.

"The Federation believes that councils need to face the financial consequences of limiting a landowner's ability to farm viably because of the aesthetic demands of their neighbours. The Federation are not seeking to water-down the environmental goals of the Act but to overcome its inherent deficiencies, which are constraining economic development."

"The RMA consents process is a major concern," said Mr Polson. "We must not deny the legitimate rights of people who are genuinely compromised by the activities of others, but the balance in the Act is too heavily weighted to allow for frivolous and vexatious complaints."

Mr Polson cited a case involving a member in the Bay of Plenty who spent $12,000 to renew effluent discharge consent, only to have the objector not bother to attend to the hearing.

"The recently released discussion paper on the reform of the Local Government Act does nothing to address a fundamental flaw in the way local government operates in New Zealand, Mr Polson said. "Back in the 1800's taxing people on the basis of the value of their land was a reasonably equitable method of gathering revenue. It is clearly outmoded and outdated in today's world, yet the government intends to perpetuate and accentuate the failed system in its proposals."

"Before the government proceeds any further with this change the fundamental basis for raising revenue must be addressed. An independent panel of taxation experts must look at the funding issue before there is any expansion of local government powers," Mr Polson said.

Mr Polson advised that the Federation had succeeded in getting its nominee on the recent Compliance Cost panel and that there were some sound recommendations coming from this panel. In particular the suggestion of a local government/RMA review office and a dedicated ombudsman. This review clearly demonstrated that small and medium sized businesses like farms face disproportionately higher compliance costs and penalties for non-compliance.

"If New Zealand is to remain globally competitive we cannot ignore constraints like the RMA, creeping regulation and high tax rates. The Federation is working tirelessly on these issues because we know how important they are to our members who compete on a daily basis with other producers around the world," Mr Polson concluded.


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